19 July 2017 Värnamo

Q2 2017 Presentation

Second quarter

Q2 2017 In Brief• Continued organic growth, despite negative calendar effects

o Market share gains in both International and Swedeno Underlying demand higher in segment International and

significantly higher in Sweden

• Unusually high order intake for second quarter

• Weaker marginso Lower gross margin, primarily in Sweden

• Higher purchasing prices recent quarters, driven by raw material prices• Price increases to customers being implemented, but not yet enough to

compensate• 3 MSEK of acquisition-related costs charged to Opex in quarter

• Acquisition of Thunderbolts in the UK

2

Net sales Q2 Strong order intake, higher than net sales Net sales increased by 8%, whereof 3% organic

Neg. calendar effects of approx. 5% Improved market share in both segments Underlying demand significantly higher in Sweden and

somewhat higher in International

Operating profit Q2 2016 82

Currencies 0

Volume +6

Price/cost/mix/other -11

Acquisitions 0

Operating profit Q2 2017 77

3

Quarter 2 Δ Jan–Jun Δ 12-monthsrolling Full year

SEK millions 2017 2016 % 2017 2016 % 2016/17 2016

Order intake 833 739 13 1,644 1,478 11 3,053 2,887

Net sales 823 762 8 1,638 1,480 11 3,004 2,847

Gross profit 232 223 4 471 429 10 870 828

Gross margin, % 28.2 29.3 28.7 29.0 29.0 29.1

Operating expenses -155 -141 10 -304 -276 10 -584 -556

Operating profit/loss 77 82 -6 167 153 9 286 272

Operating margin, % 9.4 10.8 10.2 10.3 9.5 9.6

Profit/loss after tax 54 59 -9 116 108 7 171 163

Adjusted profit/loss after tax 54 59 -9 116 108 7 195 187

Earnings per share, SEK 1.41 1.55 -9 3.05 2.84 7 4.49 4.29

Adjusted earnings per share, SEK 1.41 1.55 -9 3.05 2.84 7 5.12 4.92

Second quarter

Financial highlights, Group

Second quarter

Financial development, Group

-10

-5

0

5

10

15

20

Perc

ent

Quarterly Year-on-Year net sales growthOrganic growth Acquisitions and currency translation

0

50

100

150

200

250

300

350

0

500

1000

1500

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2500

3000

3500

LTM

Adj

Op

Res

, SEK

milli

on

LTM

Net

sal

es, S

EK m

illion

s

L12M Net Sales, MSEK L12M EBIT (adj), MSEK

4

Second quarter

Segment International

Net sales Q2 Order intake higher than net sales Net sales grew by 10%, whereof 2% organic Negative calendar effects Higher market shares in several markets Underlying demand somewhat higher adjusted for

negative calendar effects

Operating profit Q2 2016 50

Currencies +1

Volume +3

Price/cost/mix/other -5

Acquisition +3

Operating profit Q2 2017 52

*Refers to net sales and order intake from external customers

5

Quarter 2 Δ Jan–Jun Δ12-

monthsrolling

Full year

SEK millions 2017 2016 % 2017 2016 % 2016/17 2016

Order intake* 551 481 14 1,082 969 12 2,020 1,907

Net sales* 541 491 10 1,077 965 12 1,992 1,880

Gross profit 156 144 8 312 282 11 577 547

Gross margin, % 28.8 29.4 29.0 29.2 29.0 29.1

Operating expenses -104 -94 10 -205 -185 11 -392 -372

Operating profit/loss 52 50 4 107 97 10 185 175

Operating margin, % 9.6 10.2 9.9 10.0 9.3 9.3

Second quarter

Financial development, International

0

50

100

150

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0

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1000

1500

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LTM Adj O

p Res, SEK m

illionLTM

Net

sal

es, S

EK m

illion

s

L12M Net Sales, MSEK L12M EBIT (adj), MSEK

-15

-10

-5

0

5

10

15

20

25

30

35

Perc

ent

Quarterly Year-on-Year net sales growthOrganic growth Acquisitions and currency translation

6

Quarter 2 ΔJan–Jun Δ

12-monthsRolling

Full year

SEK millions 2017 2016 % 2017 2016 % 2016/17 2016

Order intake* 282 258 9 562 509 10 1,033 980

Net sales* 282 272 4 561 515 9 1,013 968

Gross profit/loss 81 82 -1 168 154 9 308 295

Gross margin, % 28.9 30.3 29.9 30.0 30.4 30.5

Operating expenses -44 -42 4 -89 -82 8 -172 -165

Operating profit/loss 37 40 -6 78 72 9 137 130

Operating margin, % 13.2 14.6 14.0 13.9 13.5 13.4

Second quarter

Net sales Q2 Order intake in line with net sales Net sales increased by 4%, whereof 4% organic

Negative calendar effects Market share increase Strong underlying demand

Operating profit Q2 2016 40Currencies -1

Volume +3

Price/cost/mix/other -5

Acquisition 0

Operating profit Q1 2017 37

Segment Sweden

7

*Pertains to net sales and order intake from external customers

Second quarter

Financial development, Sweden

-15

-10

-5

0

5

10

15

20

Perc

ent

Quarterly Year-on-Year net sales growth

Organic growth Currency translation effects and acquisition

0

50

100

150

200

0

500

1000

1500

2000

LTM Adj O

p Res, SEK m

illion

LTM

Net

sal

es, S

EK m

illion

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L12M Net Sales, MSEK L12M EBIT (adj), MSEK

8

Second quarter

Acquisitions since 2014

9

NWC as % of Net Sales (12 months rolling)

30

31

32

33

34

35

36

37

38

39

40

Q12014

Q22014

Q32014

Q42014

Q12015

Q22015

Q32015

Q42015

Q12016

Q22016

Q32016

Q42016

Q12017

Q22017

Excluding APEX Bufab Group

10

Second quarter

Second quarter

EBIT Bridge

Group International Sweden OtherEBIT Q2 2016 82 50 40 -8

Currency 0 +1 -1 0

Volume +6 +3 +3 0

Price/cost/mix & other -11 -5 -5 -1

Acquisitions 0 +3 0 -3EBIT Q2 2017 77 52 37 -12

11

Second quarter

Summary and outlook• Continued good growth in second quarter despite calendar effects

o Organic growth both segments despite negative calendar effects o Good market share gains and higher underlying demand

• …but weaker gross margin: raw materials-driven purchasing prices

• Outlooko Trend towards higher purchasing prices seems to have leveled offo Price increases to customers being implementedo Unusually strong order intake in Q2o Unchanged ambition level

• Strategy workingo Market shares and Efficiencyo Acquisitionso Bufab Best Practice

12

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